The tightness of the Swiss labour market appears strongly correlated with inflation pressures. With labour market tightness and therefore inflation abating, the SNB has room to cut interest rates in September.
What do you reckon are the predominant shocks hitting the Beveridge curve in Switzerland over the period for which you have wage data @Stefan? I’m just thinking that you could have a structural break in the relationship with inflation if Covid was a major reallocation shock rather than an aggregate demand shock.
What do you reckon are the predominant shocks hitting the Beveridge curve in Switzerland over the period for which you have wage data @Stefan? I’m just thinking that you could have a structural break in the relationship with inflation if Covid was a major reallocation shock rather than an aggregate demand shock.